Your credit score is an essential factor that quantifies your creditworthiness. A credit score typically ranges from 300 to 900. A credit score ranging from 750 to 900 is regarded as excellent. A person’s chances of getting a loan are increased by having a better credit score. However, for people with a low CIBIL score personal loan is still a possibility.
Why is a Good Credit Score Essential?
Getting loan finance is a complex process. Your chances of securing a loan increase if you have a good credit score. Look at a few factors that make a credit score significant:
- Access to credit
A high credit score might help a person get credit more easily and qualify for Personal, Vehicle, or Business Loans. A low credit score may restrict loan availability or may lead to higher interest rates and inflexible terms. Your credit score reveals how well you’ve handled your loan and debt repayments in the past.
- Reduced interest rates
You may save a significant amount throughout your EMI tenure by taking advantage of lower interest rates that you get when you have a good credit score. If you have a strong credit history, you’ll always be able to get the best interest rates on your loans.
- Improved financial opportunities
Better credit card offers, cheaper insurance rates, and affordable financial goods and services are just a few of the economic prospects a strong credit score can bring about.
These are some of the key benefits of having a high credit score. However, you don’t have to worry if you have a poor credit score, as there are financial institutions that facilitate borrowers even with low CIBIL scores to get Personal Loans. However, the loan interest rates are higher in such cases.
How Can Your Credit Score Be Raised?
Here are some suggestions to raise or maintain a credit score:
- Create recurring reminders to pay credit card dues or loan EMIs on time.
- Hold onto older credit cards to extend your credit history.
- Keep your credit consumption under check to keep a healthy utilisation ratio.
- Avoid taking on multiple loans at once rather repay one loan before taking out another.
How Can You Check Your Credit Score Online?
- Visit a loan provider’s website
Check out the website of any reputed financial institution or NBFC. Go to the website’s check credit score section.
- Make a profile
To create an account, you must register your name, gender, and date of birth.
- Choose your ID proof
You may use your driving licence, voter ID number, passport number, income tax identification number, or PAN card to confirm your identity.
- Enter your personal information
You must enter personal information like your complete address, phone number, email address, etc.
- Check your information
You must accept the terms and continue after providing all the required information. You will receive a one-time password on your phone for verification, which you must enter in the account setup form.
- View your credit score
After entering the OTP and accepting the terms & conditions, click submit, and you can soon generate your credit report.
Follow the above steps to check your credit score online. Don’t worry if you obtain a low score; numerous financial institutions provide Personal Loans on low CIBIL scores.
Conclusion
A credit score is one of the top indicators of your financial stability. It enables financial institutions to take a quick snapshot of your credit history. Your chances of getting approved for a Finance loan will increase as your credit score rises.
